Vijayawada, May 16 (IANS) The Special Investigation Team (SIT) probing the alleged Andhra Pradesh liquor scam on Friday arrested K. Dhanunjaya Reddy, a retired IAS officer and former Secretary of former Chief Minister Jagan Mohan Reddy, and Krishna Mohan Reddy, his former Officer on Special Duty (OSD).

They were arrested after their questioning by the SIT officials for a third consecutive day. The former bureaucrats are likely to be produced before a magistrate on Saturday.

Dhanunjaya Reddy and Krishna Mohan Reddy are accused numbers 31 and 32, respectively, in the case. They were grilled for nine hours on Friday.

The SIT arrested them hours after the Supreme Court refused to grant them anticipatory bail. The apex court dismissed their petitions on the ground that the investigation in the case is at a crucial stage.

Earlier, the Andhra Pradesh High Court had dismissed their petitions for anticipatory bail and they had challenged the same in the Supreme Court.

During the last three days, the SIT officials reportedly grilled former bureaucrats about the recipients of kickbacks from the distillery companies.

They, along with Govindappa Balaji, the Director of Bharathi Cements Corporation, were recently included in the FIR as accused into the alleged scam of Rs 3,200 crore.

The SIT arrested Balaji in Karnataka on Tuesday. A Vijayawada court sent him to judicial custody till May 20.

Balaji, alleged to be a close aide of Jagan Mohan Reddy, is listed as accused number 33 in the case and is accused of distributing kickbacks among liquor syndicate members through shell companies.

Meanwhile, the SIT continued questioning Sajjala Sridhar Reddy in its custody. Friday was the second day of his custody.

A court granted three-day police custody of Sridhar Reddy, who is accused No. 6 in the case. He was arrested from his residence in Hyderabad on April 26.

Sridhar Reddy, who is also the Managing Director of Spy Agro Industries, along with other accused, allegedly participated in the meetings conducted on the liquor policy.

He is alleged to have played a key role in mediating between the owners of various distillery companies, officers of Andhra Pradesh State Beverages Corporation Limited (APSBCL), the Prohibition and Excise Department and the YSR Congress party leaders and in receiving kickbacks.

There are allegation that the YSR Congress Party leaders encouraged new liquor policy, floated new brands during YSRCP rule, received kickbacks from the distillery companies and caused huge loss to the government.

The TDP-led NDA government constituted the SIT in November last year to investigate the allegations of irregularities and corruption in Andhra Pradesh State Beverages Corporation Limited (APSBCL) under the YSRCP tenure.

–IANS

ms/vd